TY - JOUR
T1 - Choices, situations, and happiness
AU - Köszegi, B
AU - Rabin, M
PY - 2008/8
Y1 - 2008/8
N2 - This article explores some conceptual issues in the study of well-being using the traditional economic approach of inferring preferences solely from choice behavior. We argue that choice behavior alone can never reveal which situations make people better off, even with unlimited data and under the maintained hypothesis of 100% rational choice. Ancillary assumptions or additional forms of data such as happiness measures are always needed. With such ancillary assumptions and additional data, however, the use of revealed preference to study well-being can be significantly improved, so that the choices people make can jointly identify preferences, mistakes, and well-being.
AB - This article explores some conceptual issues in the study of well-being using the traditional economic approach of inferring preferences solely from choice behavior. We argue that choice behavior alone can never reveal which situations make people better off, even with unlimited data and under the maintained hypothesis of 100% rational choice. Ancillary assumptions or additional forms of data such as happiness measures are always needed. With such ancillary assumptions and additional data, however, the use of revealed preference to study well-being can be significantly improved, so that the choices people make can jointly identify preferences, mistakes, and well-being.
KW - Happiness
KW - Revealed preference
UR - https://www.webofscience.com/api/gateway?GWVersion=2&SrcApp=ceuapplication2024&SrcAuth=WosAPI&KeyUT=WOS:000257692400006&DestLinkType=FullRecord&DestApp=WOS
U2 - 10.1016/j.jpubeco.2008.03.010
DO - 10.1016/j.jpubeco.2008.03.010
M3 - Article
SN - 0047-2727
VL - 92
SP - 1821
EP - 1832
JO - Journal of Public Economics
JF - Journal of Public Economics
IS - 8-9
ER -